Think Tanks Challenge Legal Validity of Biden's Student Debt Bailout Plan

President Biden's Student Debt Bailout Plan Faces Legal Challenges

President Joe Biden's revised student debt bailout plan, which aims to forgive federal student loans worth approximately $39 billion for 800,000 borrowers, is facing legal challenges. The plan, scaled back after being rejected by the Supreme Court, has been challenged in a lawsuit filed by two think tanks.

The New Civil Liberties Alliance has filed a legal challenge in Michigan on behalf of the Mackinac Center for Public Policy and the Cato Institute. The lawsuit argues that the Department of Education is exceeding its authority with a forgiveness plan and seeks a ruling declaring it illegal.

The Education Department has responded to a lawsuit filed against them by stating that it is a desperate attempt by right-wing special interests to keep borrowers in debt. The department is determined to defend working families and will not back down.

The Biden administration's plan to forgive up to $20,000 of federal student debt for 43 million borrowers has faced legal challenges. Several states argued that the plan would illegally relieve loans they were responsible for servicing, potentially costing them millions of dollars annually. As a result, the plan has been thwarted.

The Supreme Court has declared President Biden's plan unconstitutional, which aimed to fulfill a campaign promise. Two weeks later, the administration introduced a revised version of the plan.